FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
CHAPTER 20 - TITLE CLEARANCE AND APPROVAL
21 - TITLE EVIDENCE. The Forest Supervisor needs to acquire title insurance in each
right-of-way case. Title insurance is available and will be used throughout the Region.
Exceptions to the use of title insurance may be authorized on an individual case basis. Each
Forest has been provided with a copy of the Department of Justice's list of approved "parent"
and/or local title insurance companies. Only approved title insurance companies may be used.
All title insurance policies must be in the format approved by the Attorney General and the
American Land Title Association for insuring title conveyed to the United States. The format is
described in the STANDARDS (Standards for the Preparation of Title Evidence in Land
Acquisitions by the United States, Department of Justice, 1970). Title companies have a
standard printed form, developed by the American Land Title Association, to be used for
acquisitions by the United States.
Title companies are required by the State to publish a rate schedule for services provided, and
must abide by that schedule. The schedule is filed with the State Insurance Commissioner.
21.11 - Title Insurance. A Policy of Title Insurance is obtained as preliminary title evidence.
Schedule A of the policy will indicate property ownership as fee title in the name of the grantor.
After all documents are recorded, an endorsement will be requested to update the title policy and
to insure the easement rights vested in the United States. Final title evidence consists of the
Title Insurance Policy together with all endorsements.
1. Coverage. Title insurance for the full value of the acquired property is to be obtained
when the deed to the United States is without general warranty. The policy will be obtained for
not less than the maximum coverage available for the minimum charge of the title company.
Care should be exercised in placing orders. To avoid inflated charges, clearly combine all
subdivisions under one ownership in one title insurance policy. Even though a policy covers
only one ownership, it may be used as title evidence for more than one easement from the same
landowner. In such cases, a separate endorsement for each easement is obtained. The
endorsement will contain only the Schedule B exceptions applicable to that easement.
2. Schedule B of the Title Insurance Policy. When the preliminary title report reveals
troublesome title defects, the case should be referred to the Regional Office Lands Group before
the deed is recorded. This will provide the opportunity for timely coordination with OGC.
Every reasonable effort should be made to convince each title company to keep Schedule B clear
and unencumbered of blanket clauses and unnecessary or vague exceptions which take additional
time and expense for the Forest Service and the Office of General Counsel to eliminate or waive.
Forests should assume the responsibility of providing evidence (maps, photographs, etc.)
sufficient to persuade the title company that certain matters of record do not encroach, conflict,
or encumber the easement area described in Schedule A. Exceptions cleared by recorded
instruments should be removed from the policy following recordation.
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
The subject easement should not be included as an exception on Schedule B that have not been
deleted by endorsement of the policy; however, the "terms and conditions" of the subject
easement may be listed as an exception.
The STANDARDS specify that "Schedule 'B' shall not set forth exceptions or objections in
general terms or by reference to deeds, instruments, proceedings, or other matters of record,
without including copies or a sufficient abstract or digest of the instruments or the proceedings or
other matter of record creating or imposing the rights, interest, or encumbrances mentioned in
Schedule 'B' . . . ." Copies of all instruments listed in Schedule B need to be attached to the
policy and made part of the title assembly.
Copies of all known unrecorded instruments creating an outstanding right need to be attached
and addressed on the Certificate of Inspection and Possession.
The blanket exception clause "mineral rights, water rights, claim or title to minerals or water" is
acceptable on Schedule B providing the following notation is included:
"Note: While this policy does not insure minerals or title to minerals, we found nothing in
our examination to indicate that the minerals have been severed from the fee title." And
when appropriate, the additional statement "except the following:
."
3. Sketch Map of Area. There should be included in the title package a sketch map or
drawing portraying the location of the easement across the grantor's property. It should also
show the relationship of the easement with facilities encroaching upon it and/or other easements
on the property known or referred to in Schedule B of the title insurance policy. Facilities such
as fences, water pipelines, and electric lines, which are in the vicinity but do not encroach upon
the easement, should also be exhibited. Those items which are displayed on the right-of-way
plat need not be shown on the sketch map.
21.31 - Taxes. The dates for tax liens, payments, and delinquencies for the States in Region 1
are as follows:
State
Lien Attaches
Billed
1st 1/2 Due
2nd 1/2 Due
Idaho
First Day of
January
Fourth
Monday
in Nov.
Dec. 20
June 20
next year
Montana
First Day of
January
Early fall
on notice
Nov. 30
May 31
next year
North Dakota
January 1
next year
January 1
same
March 1
Oct. 15
South Dakota
First Tuesday
in September
January 1
next year
April 30
next year
Oct. 31
next year
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
Washington
January 1
preceding
Early in
year, on
notice
April 30
Oct. 31
1. Clearing Delinquent Taxes by Authority from Grantor to Withhold Tax Payment from
Consideration. Exhibit 1 is an acceptable form which may be used to obtain authority from the
grantor to withhold from the consideration to be paid for an easement, an amount sufficient to
assure the payment of taxes which are a lien against the right-of-way.
Exhibit 1
TAX WITHHOLDING AUTHORIZATION
Forest Supervisor
We,
, hereby authorize the United
States of America to withhold from the purchase price due us for the right-of-way easement
conveyed to the United States of America and its assigns by that certain easement deed dated
, 19 , an amount sufficient to pay all taxes which have attached or may attach as a lien to the
land embraced by said easement. It is understood and agreed that when we shall pay such taxes
and shall furnish adequate proof thereof, the amount so withheld shall be paid to us.
Date
2. Clearing Delinquent Taxes by Payment of Segregated Amount. If the tax problem
cannot be cured by a "Tax Withholding Authorization" for the entire amount of delinquent taxes,
the Forest Supervisor may request the county assessor to prorate the taxes between the easement
and fee. A small tax would remain to be paid. Some county assessors will, upon a request for
proration, set the tax on a road easement at zero, and carry all the tax on the underlying land.
3. Clearing Delinquent Taxes by County Statement of Policy. Delinquent taxes may be
waived when the county issues a letter to the Forest Service stating that tax-titles will except road
easements granted the U.S. of America. The letter should state in essence that:
Sales of tax foreclosed by property by
County will contain a provision in
the "Notice of Sale" and the "Deed" subjecting the conveyance of such property to
recorded easements acquired by the Forest Service.
4. Clearing Delinquent Taxes by County Statement on Individual Case Basis. Delinquent
taxes may be waived on a case basis with the following disclaimer (Exhibit 2) from the county.
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
Exhibit 2
WHEREAS, the United States of America acquired an easement for a right-of-way from
, dated
, 19 , and recorded
, 19 , in Book
, pages
, Deed Records of
County, State of
Montana, over the following described real property situated in the County of
,
State of Montana, to wit:
T. ___ N., R. ___ E., P.M., MT.
section ______, ___________
WHEREAS, the property taxes for the first half of 19
of the above-stated real property were
due
, 19 , and are now delinquent.
NOW, THEREFORE, be it resolved by the County Commissioners of
Montana:
County,
We, the County Commissioners of
County ensure that any subsequent conveyance of
the above-stated lands crossed by the Forest Service's
,19
, easement, which
lands _________________ County may acquire through tax delinquency, shall be made subject
to and subordinate to the
, 19 , easement.
Passed and adopted by the County Commissioners of
regular session held thereof on the
day of
, County, Montana, at a
, 19 .
Title Commissioner Chairman
Title Commissioner
Title Commissioner
Title Clerk & Recorder
21.32 - Mortgage Liens. If a waiver is not appropriate, the lien must be subordinated to the
easement. Exhibit 1 provides a format for the Consent and Subordination Agreement when the
mortgage holder does not have its own.
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
Where the mortgage holder requires payment, an agreement with the landowner to withhold
funds to cover the payment may be necessary. Such agreements will be referred to the Regional
Office for approval prior to execution.
A deed of trust is sometimes used instead of a mortgage. In the deed of trust, the borrower
conveys the property to a trustee as security for the indebtedness. When a deed of trust is
subordinated to the easement, the Consent and Subordination Agreement is executed by the
trustee.
Exhibit 1
CONSENT AND SUBORDINATION AGREEMENT
WHEREAS,
hereinafter called the
"CONSENTER," has an interest in or lien upon the real property hereinafter described by virtue
of a (1)
, dated
, 19___, and recorded
, 19 , in Book
, page
, (2)
Records of
County, State of
, and which interest or lien covers the
following described real property situated in the County of
, State of
, to wit:
(Township, Range, Section, Subdivision)
WHEREAS,
hereinafter called the "GRANTOR,"
has conveyed to the United States of America, hereinafter called the "GRANTEE," an easement
for right-of-way purposes over and across said real property by virtue of instrument dated
, 19 , and recorded
, 19 , in Book
, page
,
County
Records, State of
.
NOW, THEREFORE, the Consenter consents to the above-mentioned conveyance from the
Grantor to the Grantee and subordinates its interest in or lien upon the real property hereinbefore
described to the rights of the Grantee in and to said real property by virtue of the
above-mentioned instrument.
IN WITNESS WHEREOF, the Consenter has caused this instrument to be executed this
day of
, 19___.
By
Title
SEAL
Attest:
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
Secretary
APPROPRIATE ACKNOWLEDGMENT
(1) Insert type of document; i.e., trust deed, mortgage, etc.
(2) Show deed, mortgage, or delete line as appropriate.
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
21.34 - Outstanding Rights. Curative documents that affect an outstanding right must be
recorded if the outstanding right was recorded. Unless they conform to standard formats or
have been previously approved, all curative documents should be referred to the Regional Office
prior to signing or recording, as the case may require.
1. Possessory Interests of Tenants, Lessees, and Squatters. Persons other than the owner
may be in possession under a recorded agreement, an unrecorded agreement, or without an
agreement of any kind.
Unrecorded interests may be cured by obtaining a consent, worded somewhat as follows:
I (or we) hereby consent to the granting of a road right-of-way by
(landowner)
to the
United States of America by the said Grantor and occupied by me (or us) as a
(lessee,
tenant, or other) .
(Date)
(Signatures)
If the person or persons are in possession under a recorded agreement, use the Consent
Agreement shown as Exhibit 1.
2. Easements.
a. Prior Utility Easements. If the easement obtained by the Forest Service encroaches
upon or crosses a utility easement, a "Consent Agreement" similar to Exhibit 1 must be obtained.
When it is necessary to move existing utilities, the arrangements should be included in the
consent agreement.
b. Prior Road Easements. Prior easements for roads must be subordinated so the Forest
Service can exercise control over all traffic using the road. For this purpose, and to provide the
easement holder with a continued right to use the road, Exhibit 2 should be used.
If a prior easement only crosses the Forest Service easement, subordination may not be required
and the Consent Agreement (Exhibit 1) could be used.
If a prior easement is held by the Bureau of Land Management (BLM), a transfer of jurisdiction
under Section V-A of the BLM-FS Interagency Right-of-Way and Road Use Agreement (FSM
5465.1) is required.
If a prior easement is held by a cost-share cooperator and the road is included in the cost-share
program, the prior easement must be assigned to the Government, terminated, or subordinated.
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
4. Outstanding Mineral Rights.
a. Producing Oil and Gas Leases or Fields. A producing Lease and/or Field is an area
where the mineral is known to exist and, in the case of oil and gas, the extent of the field has
been defined. Consent agreements and disclaimers must be obtained for producing oil and gas
leases. In those situations where this seems to be impossible, a request for administrative
waiver will be considered. The request needs to include a statement of the relevant facts in
relation to the easement and the attempted curative actions taken.
b. Oil and Gas Leases Outside a Producing Lease and/or Field. When consent agreements
or disclaimers are difficult to obtain from owners of oil and gas leases, waiving the lessee's
interest will be considered. A request for waiver needs to be accompanied by the Forest
geologist's evaluation of the mineral activity during the lease period and his/her assessment of
the possibility of conflict with the easement to be acquired.
Exhibit 1
CONSENT AGREEMENT
WHEREAS,
hereinafter called the
"CONSENTER," has an interest in the real property hereinafter described by virtue of a prior (1)
, dated
, and recorded in Book
, page
, Records of
County,
State of
, to wit:
(Township, Range, Section, Subdivision)
WHEREAS,
, hereinafter called the "GRANTOR,"
has conveyed to the United States of America, hereinafter called the "GRANTEE," an easement
for right-of-way purposes over and across said real property by Easement Deed dated
day of
, 19 .
NOW, THEREFORE, the Consenter consents to the above-mentioned conveyance from the
Grantor to the Grantee upon the real property hereinbefore described.
IN WITNESS WHEREOF, the Consenter has caused this instrument to be executed this
day of
, 19 .
SEAL
Title
(1) Insert type of document; such as, lease, contract, prior easement, etc.
(APPROPRIATE ACKNOWLEDGMENT)
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
Exhibit 2
CONSENT AND SUBORDINATION AGREEMENT
WHEREAS,
hereinafter called the
"CONSENTER," has an interest in or lien upon the real property hereinafter described by virtue
of a (1)
, dated
, 19 , and recorded
, 19 , in Book
, page
, (2)
Records of _____________ County, State of
, and which interest or lien covers
the following described real property situated in the County of
, State of
, to wit:
(Township, Range, Section, Subdivision)
WHEREAS,
hereinafter called the "GRANTOR," has
conveyed to the United States of America, hereinafter called the "GRANTEE," an easement for
right-of-way purposes over and across said real property by virtue of instrument dated
,
19 , and recorded
, 19
, in Book
, page
,
County Records,
State of
.
NOW, THEREFORE, the Consenter consents to the above-mentioned conveyance from the
Grantor to the Grantee and subordinates its interest in or lien upon the real property hereinbefore
described to the rights of the Grantee in and to said real property by virtue of the
above-mentioned instrument.
IN WITNESS WHEREOF, the Consenter has caused this instrument to be executed this
day of
, 19 .
(Corporation Name)
SEAL
By
Title
Attest:
Secretary
APPROPRIATE ACKNOWLEDGMENT
(1) Insert type of document; i.e., trust deed, mortgage, etc.
(2) Show deed, mortgage, or delete line as appropriate.
22.31 - Final Title Assembly
1. Forest Supervisors will submit the original executed and recorded easement.
FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK
R-1 SUPPLEMENT 5
EFFECTIVE 12/07/90
2. Checklist for Final Title Assembly. Submit two copies of the completed
CHECKLIST (R1-FS-5460-1) with each title assembly.